It is estimated that in the first quarter of 2021, the annual growth rate of the sales value of Taiwan's plastic product manufacturing industry will turn into a growth trend
Affected by the epidemic in 2020, the demand for isolation plastic sheets and films for epidemic prevention in Taiwan's domestic market has increased. In addition, the demand for meal take-out and delivery has increased, and the consumer demand for packaging bags has improved. In addition, the accelerated pace of domestic public works and Taiwanese investment in Taiwan will help increase the demand for engineering pipes and industrial plastic products. However, due to the deterioration of the global economic environment, people's willingness to consume has become more conservative. In addition, the postponement of the Olympic Games, the derived sports The lack of business opportunities for supplies and footwear has led to a decline in the sales of plastic products, plastic leather, and cloth for people's livelihood. In addition, the domestic sales of industrial plastic films were not satisfactory. In addition, the epidemic has affected the overseas market economy and the production performance of the manufacturing industry, coupled with the disruption of logistics and transportation, resulting in a decline in the export value of this industry. Therefore, the annual growth rate of Taiwan's plastic product sales in 2020 will decline slightly by 2.19%.
In the first quarter of 2021, thanks to the recovery of the global economy, the production performance of manufacturing industries in Taiwan and abroad expanded. The public's willingness to consume increased and awareness of epidemic prevention was formed. The demand for engineering and Taiwanese businessmen returning to Taiwan for investment still supports the demand for engineering pipes and industrial plastic products. In addition, the domestic housing market transaction volume is growing optimistically, and the demand for derivative housing repairs and interior decoration increases. The domestic sales of plastic sheets, pipes, and other products performed significantly better In the same period in 2020. It is estimated that in the first quarter of 2021, the annual growth rate of the sales value of my country's plastic products industry will turn into a growth trend.
In terms of export performance, Taiwan's export areas are dominated by the Chinese and North American markets, followed by the ASEAN region. First of all, in terms of export to the Chinese market, since 2021. Due to the slowdown of the epidemic in China, and the expansion of the economy and manufacturing production, benefiting from the increase in the demand for packaging materials in the Chinese market, the export of plastic film bags to China is optimistic. Therefore, it is estimated that in 2021 In the first quarter, the annual growth rate of China's export value of this industry has grown substantially by more than 20%. In terms of exports to the North American market, the plastic industry is concentrated in the US market. From January to February 2021, the US accounted for 23.94% of the industry's export value.
Since 2021, the epidemic in the United States has gradually slowed down, and the economy has turned into a recovery situation. The demand for plastic products for people's livelihood has recovered. In addition, the demand for the U.S. housing market and repair market is booming, which will help drive the growth of the export of related building repair plastic products to the United States. Note that the snowstorm hit the United States in February, which affected logistics and transportation and delayed orders. Therefore, it is estimated that the export of this industry to the United States in the first quarter of 2021 will only grow slightly by 2% to 3%. In terms of exports to the ASEAN market, Vietnam is the largest exporter of Taiwan's plastic products to ASEAN. From January to February 2021, Vietnam accounted for 5.55% of the industry's export value, followed by Thailand, Indonesia, the Philippines, Singapore, and other countries. Although the epidemic situation in Southeast Asian countries such as Indonesia and the Philippines has been severe since 2021, the global economic recovery has improved. And export orders in the ASEAN market have rebounded, supporting the economy and manufacturing production performance, and helping the industry to export to the ASEAN market. In terms of export products, From January to February 2021, the export of various plastic products to Southeast Asia will be different, and the export of plastic daily necessities to Southeast Asia will not perform well. The growth momentum of exports to Southeast Asia is mainly from industrial plastic products and plastic film bags. On the whole, it is expected that in the first quarter of 2021, the export of this industry will generally grow in all major regions. In particular, the growth momentum of exports to China is relatively strong. It is estimated that the annual growth rate of the export value of this industry will increase by more than 10%, and the export performance will improve significantly.
Since 2021, due to the continuous production reduction policy of OPEC members and the blizzard attack on the United States. The production of crude oil in the United States has declined, the global crude oil supply has been tightened, and the global economy has returned to the growth track. In addition, in February, the United States was disturbed by the blizzard and severe cold weather, which affected the supply of olefin production capacity in Texas, Luzhou, and other regions. In addition, the global market demand for petrochemical raw materials recovered, which pushed up the price of petrochemical raw materials. Therefore, the price of petrochemical raw materials is higher than that in 2020. In the same period, there was a sharp rise, and the price of injection molding rubber raw materials rose. In addition, the blizzard attack in the United States also affected the capacity supply of ethylene and downstream derivatives in the United States. Therefore, the price of plastic raw materials such as PVC and LDPE rose relatively strongly. As for ABS resin, Influenced by the hot production and sales of terminal home appliances, the price of ABS resin raw materials has risen significantly, and PP, PS, and HDPE have increased by more than 30%. Overall, the price of plastic raw materials generally rose sharply in the first quarter of 2021, and the pressure on the cost of plastic raw materials faced by the industry increased significantly.
In November 2020, 15 countries in the Asia-Pacific region completed the signing of the Regional Comprehensive Economic Partnership (RCEP). The participating countries include the 10 ASEAN countries, China, Japan, South Korea, Australia, and New Zealand. Although the largest exporter of the plastics industry is the North American market, the RCEP member countries also account for a large proportion of the export value of Taiwan's plastic products. According to the import and export data of Taiwan Customs in 2019, China, Japan, South Korea, and the ASEAN together account for the proportion of the export value of this industry. The tariff rate of non-zero products exported to RCEP member countries ranges from 2.8 to 12%. The main non-zero tariff export products are mainly plastic plates, plastic tableware, packaging materials, etc. In recent years, investment in plastic product production capacity in China and the ASEAN market has shown a trend of expansion, and export competition in the plastic industry has gradually become prominent. Therefore, once the tariffs on plastic products among RCEP member countries are significantly reduced, it will inevitably bring negative competition challenges to the export of this industry to the Asian market. , especially for low-end plastic products, the threat of competition is relatively large.
However, to avoid too much competition impact on the domestic manufacturing industry, RCEP member countries generally have a buffer period of more than ten years for tax reduction. Therefore, the negative impact on Taiwan's plastic products industry is mainly in the medium and long-term stages, within one to two years in the short term limited impact.
Countries around the world are committed to promoting recyclable, decomposable, and easy-to-recycle plastic products, or through the implementation of a one-time plastic ban, direct reduction, and control of the source of production and sales are also the main driving directions. In recent years, the EU has gradually formed a complete industrial chain system for the establishment of plastic recycling materials and subsequent applications. In 2020, the EU will further introduce stricter legal measures, requiring member states to impose a plastic waste tax of 800 euros per ton on unrecycled plastic waste. And will come into effect in January 2021. This decree will accelerate the construction of plastic recycling facilities in Europe and will reduce the demand for plastic products with low recycling rates and high recycling difficulties in Europe, thereby suppressing demand for virgin plastic products demand has declined. In addition, major international brand manufacturers have also been committed to environmental protection and plastic reduction in recent years, increasing the use of recyclable, biodegradable, and reusable packaging materials. At the same time, they will also require suppliers to take corresponding actions, such as the plastic products themselves. It is easy to recycle and has a high recycling rate, or use recyclable plastic materials, whether introduce green design in the production process, etc.
On the whole, under the trend of strengthening plastic recycling and plastic reduction policies in the global market, it is necessary to pay attention to the inhibitory impact on the industry's orders and exports. The development of plastic products made of environmentally friendly materials is important for this industry. The direction of development.
It is estimated that the prosperity of Taiwan's plastic products manufacturing industry will remain flat in the next six months
The global economic outlook tends to be optimistic, and the export market has a growing demand for plastic products for people's livelihood and industrial use, which will help boost the export performance of this industry. In Taiwan's domestic market, the growth rate of Taiwan's domestic private consumption will rebound to 4.35% in 2021, showing a better situation. The economic growth rate will reach 5.03%, and the growth rate will be stronger than that in 2020. Although the overall domestic economic performance in 2021 will turn optimistic. In May 2021, there was a breach in domestic epidemic prevention, which led to a rapid increase in the number of confirmed cases. Taipei City and New Taipei City were raised to the third level of alert, requiring business establishments such as the catering industry to adopt a joint system, social distancing, or installation of epidemic prevention partitions. Such measures will help drive the domestic demand for epidemic prevention-related films and sheets to increase significantly. And the increase in Chinese people eating out instead of taking out, the demand for delivery will also increase, which will increase the demand for packaging film bags in the domestic market, but the domestic epidemic situation will increase. As a result, people's willingness to consume has become more conservative, and people's willingness to go out has been significantly reduced. The transaction volume of Taiwan's domestic housing market has shrunk, and people's demand for non-essential house repairs and interior decoration has decreased, suppressing the demand for plastic construction pipes and boards for repair and decoration applications. The domestic sales performance of plastic products will show a divergent situation.
In terms of the price trend of raw materials, although the epidemic situation is still facing the hidden danger of variant virus. While some countries such as India, Thailand, Brazil, and the United Kingdom have experienced a resurgence of the epidemic situation, countries around the world are still actively accelerating the progress of vaccine administration. It is expected that in the next six months, the global epidemic is gradually under effective control, coupled with the unwinding of restrictions in various countries. With the recovery of oil demand and the low base period of crude oil prices, it is estimated that the average price of Brent crude oil in the next six months will fall to about US$60-70 per barrel. Compared with the average price of 36 US dollars per barrel in the same period in 2020, the price of oil has risen sharply, which will drive up the prices of petrochemical raw materials and plastic raw materials.
In general, although the global economic outlook is expected to be optimistic in the next six months and the demand for plastic products for people's livelihood and industrial use in the export market is growing. It should be noted that the domestic epidemic situation is heating up, which will make the domestic sales performance of various plastic products divergent. The sales performance of plastic construction pipe and plate products will be relatively depressed. In addition, the price of upstream plastic raw materials has risen sharply, and the pressure on the raw material cost of plastic product manufacturers will increase significantly. Therefore, under the bullish factor, it is estimated that the prosperity of Taiwan's plastic products manufacturing industry will be regarded as flat in the next six months.